EURUSD Gains on US CPI, GBPUSD Sideways Ahead of GDP and Ceasefire News
EURUSD rose on softer US CPI, while GBPUSD remained range-bound amid mixed economic data and holiday-thinned trading.
Read on to see this week’s key technical levels, sentiment, and potential market catalysts.
EURUSD Gains as US CPI Fuels Rate Cut Expectations and ECB Holds Steady
EURUSD closed last week’s trading session higher on softer-than-expected US CPI data. The 2.6% CPI triggered a sell-off in the US Dollar, as traders and investors began positioning for another interest rate cut in early 2026. The ECB maintained interest rate unchanged, as widely expected, widening the policy divergence between the two central banks.
Looking ahead to this week, traders and investors are expected to be in a holiday mood, with limited trading activity due to the Christmas holidays. As a result, no significant price action is expected. The main potential catalyst behind any price action would likely be the possible agreement of ceasefire between Ukraine and Russia.
GBPUSD Under Pressure Ahead of US GDP Release
On the economic calendar, Tuesday will feature the US Gross Domestic Product release, which is expected to come in lower at 3.2%.
Technically, the GBPUSD pair remains positive after last week’s close just below 23.6% at 1.1706. Traders’ short positions are targeting profits at 1.1500.
Position sentiment: BUY 10% – SELL 90%.
EURUSD chart, December 21, 2025. Source: TenTrade.com
GBPUSD Sideways as Markets Await Ukraine-Russia Ceasefire
GBPUSD closed last week’s trading session unchanged after a tide-range, choppy, week. The BoE cut interest rates by 0.25%, as widely expected, without triggering any significant volatility in the pair. Softer-than-expected US CPI and UK CPI data largely offset each other, muting price action and keeping the pair trading in a narrow range.
Looking ahead to this week, traders and investors are expected to be in a holiday mood, with limited trading activity due to the Christmas holidays. As a result, no significant price movements are expected. Volatility may hit the markets if there is a ceasefire agreement between Ukraine and Russia.
GBPUSD Market Sentiment Mixed as GDP Data Looms
On the economic calendar, Monday features the UK Gross Domestic Product, expected to remain unchanged at 1.3%. On Tuesday, the US Gross Domestic Product is projected to come in lower at 3.2%
Technically, the pair is neutral after last week’s close just below 38.2% at 1.3374. Long positions are still open between 1.3369 and 1.3100, targeting profits above 1.3500, while short positions are targeting profits at 1.3100.
Position sentiment: BUY 60% – SELL 40%.
GBPUSD chart, December 21, 2025. Source: TenTrade.com
Key Takeaways
EURUSD rose after US CPI printed 2.6%, triggering a sell-off in the dollar.
The ECB kept interest rates unchanged, widening the divergence with the Fed.
GBPUSD remained neutral, with short positions targeting 1.1500 and long positions holding near 1.1706.
Holiday-thinned trading is expected to limit significant price action this week.
Key catalysts include US and UK GDP releases and any potential Ukraine-Russia ceasefire news.
For more detailed economic calendar events please visit our live economic calendar on:
https://tentrade.com/economic-calendar/
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